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Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
  • SIGIX Seafarer Growth & Income made the thrilling 30
    What's the connection? Is the cheapest quintile requirement intended to bias the selection toward Vanguard, American Funds, D&C (not one of the three firms totaling 18 funds on the list), and Baird? If so, is it also intended to bias against Fidelity and T. Rowe Price? As Kinnel wrote in his 2019 edition, these families tend to have funds with ERs just outside the lowest quintile.
    I do think that requiring an analyst rating is a bit hokey. Especially since this builds in an unnecessary bias toward larger firms (the ones M* covers). And it's prospective which makes it less than objective.
    M* is nevertheless rational in covering primarily larger firms: that's where the investor money is. 98% of money invested goes into the 150 largest firms.
    Aside from a few analyst rating criteria, the other screens used - like ER, manager longevity (at least five years), and so on - are objective. Are there particular criteria you feel are intentionally biased or have other problems?
    For example, comparing a manager's performance with a benchmark sounds good, until one realizes that there are some periods when most funds in a given category beat their benchmark. Wouldn't it make more sense to require a fund to best both its benchmark and its category average performance?
    That would knock out one of the few funds on the list from a smaller firm: MERDX. Meade and Schaub had a great record with Triton, but since they took over Meridian Growth in Sept 2013 (almost exactly 10 years ago), the have not set the world on fire. Sure, their 10 year record (as of Sept 30, 2023) of 7.43% annualized beat the M* benchmark of 6.88%, but it underperformed its category (returning 7.78%) and also underperformed the S&P 600 by about 0.05% cumulative over a decade, let alone the S&P 600 growth by about 1%/year on an annualized basis.
    Kinnel has fudged the list in the past, e.g. removing PRFDX because the manager (Brian Rogers) was about to retire. So in the future the fund would no longer have a manager meeting the five year requirement.
    Certainly he could have fudged his list here to remove MERDX because the fund beat a benchmark but not its category average and not a different category benchmark.
    Which funds would you knock off the list of thrilling 30 and why? Or which funds would you add by relaxing which criteria? Independent of advertising dollars.
    msf in Fund Discussions
  • MOVEit Data Transfer Breach
    As a follow up to the MoveIT etc breach, we have been hacked twice more since this summer. Our Utility was hacked with out info and an old employer of mine (2019) was hacked.
    Both offered us two years of "IDEX" credit and email address monitoring, but when I called them, they said the only way they can monitor your credit accounts is without a credit freeze. So I am supposed to unfreeze my credit reports ( so I could become an identify theft victim? ) so these turkeys can monitor it and then tell me I was a victim of identity theft?
    What a scam
    sma3 in Other Investing
  • MMF gating/redemption fees removed - Oct 2
    Below is the complete response received from Fidelity. There's really little else Fidelity could say.
    Thank you for your email that we received on October 6, 2023, regarding SEC rule 2a-7. As your concerns are important to us, your email was forwarded to the Executive Office for review. I appreciate this opportunity to address your concerns.
    Fidelity has been working diligently to implement the SEC’s amendments. To ensure our investors are aware, we have incorporated the recent changes to each money market fund’s fact sheet on our website.
    I can confirm that Fidelity fully complies with all laws and regulations applicable to our businesses, products, and services, including SEC Rule 2a-7. Before October 2, when Rule 2a-7 permitted fees and gates, Fidelity did not impose a fee upon the sale of shares or temporarily suspend a shareholder’s ability to sell shares in any money market fund we manage.
    We appreciate your years of loyalty to Fidelity, and we look forward to assisting with your accounts in the future. If you have additional questions, please call us at 800-544-6666. For your convenience, representatives are available 24 hours a day, 7 days a week.
    Sincerely,
    Nathan Snyder
    Executive Office
    What's the point of a having prospectus that (still) says that the fund might violate the law (by suspending redemptions)? It could just as easily say that the fund might hold long term securities. That's also prohibited. Hard to trust a document that borders on fiction.
    Updates to Fidelity's website do not inform all of Fidelity's investors of changes. Fidelity MMF investors also invest via third parties (e.g. WellsTrade, Merrill). They see the unamended SEC filings.
    msf in Fund Discussions
  • MFO's October issue is live and lively!
    I switched from a VW Golf to a Toyota RAV4 hybrid a few years ago. I would have gotten another Golf, but I needed more space for my dog and VW quit importing their wagon (and the Golf).
    I had resisted getting an SUV for years due to their terrible gas mileage. However, my RAV4 hybrid gets more than 40 mpg — which is considerably higher than my little Golf. I do miss the handling and easy parking with my Golf, but the RAV4 handles and parks surprisingly well, and it has much more power. And, of course, it has tons of storage space and room for my dog. We seldom get snow in NC, but the all-wheel drive could prove useful during our rare snow events.
    If I get tired of driving an SUV, I would probably now get a Toyota Prius, which has incredible gas mileage. The newest model has much more power, nice handling and good styling for a change. Toyota finally seems to be listening to critics about the awful styling of some of their models.
    Tarwheel in Fund Discussions
  • Dave Giroux TCAF ETF : Attracting assets?
    @msf and other, I want to draw your attention to market correlation in PV.
    I added VFINX to your link (by adding a benchmark ticker).
    Add VFINX
    Your three portfolios have market correlation that range from 94% - 96%. This leads me to believe they are highly correlated to market (VFINX = 1.0%), yet their standard deviation as well as their Max DD appear to be about 2/3 less correlated to “the market”. Though VFINX deviated (deeper) during Max DD (15% vs 10%) they all took the same amount of time to heal from their losses. One can get this information by clicking on the “I” symbol next their respective MaxDD figures.
    Over the long run (your charts timeframe is 8 years), if we can accepted the higher SD (the ups as well as the downs of VFINX) it appears we achieve market returns.
    1991- 2023 Comparison:
    VFINX, PRWCX, QGIEX, CSIEX
    Most investors don’t enjoy losing money and appreciate losing less even though the timeframe for “shallow losses” and “deep losses” appears to be the same (at least in this chart).
    PRWCX’s goal of providing market returns on the up side while losing less on the downside is an investor’s challenge as well. Hope it succeeds!
    bee bee in Fund Discussions
  • Brokerage firm won't allow me to add to my TRAIX (Institutional class of PRWCX)
    Several years ago, my brokerage firm performed a "share class exchange" for me at no charge, through which I exchanged all of my shares of PRWCX into the institutional class TRAIX. Now, for the last year or two, this same brokerage firm says they cannot allow me to purchase new shares of TRAIX. So I'm frozen. I've called repeatedly, spoke to a "mutual fund trader," and have always gotten the same answer. I even asked to do another "share class exchange" to transfer some of the institutional class shares TRAIX into PRWCX but the answer I've consistently gotten is that "PRWCX is closed." The "mutual fund trader" stated that he contacted TR Price on my behalf but with no luck. This is frustrating. Does anyone have any ideas on how I can add to TRP Capital Appreciation fund (in either class)? This is a brokerage link account tied to a former employer's 401a plan.
    Jim0445 in Fund Discussions
  • Leuthold: the lights have all turned red, time to lighten up on stocks
    @racqueteer
    To be clearer, and to support my statement, FPACX has done better 3y, 1y, and ytd.
    Cumulative. I do not look at, care about, or judge by single years.
    That's all. Don't own any of them currently, but wish I had for the last decade.
    >> ... can’t see a good reason to prefer it over the other two.
    Again, as I said, whether UI matters. (Also the matter of availability.)
    davidrmoran davidrmoran in Fund Discussions
  • Latest Memo From Howard Marks: Further Thoughts On Sea Change
    Summary
    ° The investment environment has undergone a sweeping alteration, calling for significant capital reallocation.
    ° The decline in interest rates over the past 40 years has been overlooked as a major driver of investment profits.
    ° Credit instruments may offer competitive returns and should be considered for a substantial portion of portfolios.
    Article
    Mark Mark in Other Investing
  • Leuthold: the lights have all turned red, time to lighten up on stocks
    “ FPACX has nontrivially outperformed PRWCX the last few years,”
    Let’s be clear…. M* has PRWCX ahead by about 6% in 2020 and 3.5% in 2021. Behind by about 1.7% in 2022 and 1.6% this year. I’m not sure that supports your statement, but it certainly supports the notion that the cash helped its return recently.
    Again, I have no issue with FPACX being a decent fund, but I can’t see a good reason to prefer it over the other two. Ymmv
    racqueteer in Fund Discussions
  • Leuthold: the lights have all turned red, time to lighten up on stocks
    @racqueteer
    I don't see why it would be logical since you don't mention it.
    Ah, maybe you meant
    >> Those who know me know ...
    Romick's cash thing has been discussed here for decades, iirc, and I myself care only about returns as a function of UI and vice-versa.
    FBALX has waaay higher UI most of the time (in keeping with Fidelity's ever aggressive equity-favoring approaches).
    I've no other thoughts on what you don't see. FPACX has nontrivially outperformed PRWCX the last few years, yes, and with lower or the same UI. If you knew all that, bully.
    davidrmoran davidrmoran in Fund Discussions
  • Leuthold: the lights have all turned red, time to lighten up on stocks
    Agree, BaluBalu. Those who know me know that I've spent a lot of time looking at the Allocation-type funds over the years, and while traditional bonds have done them no favors with rates rising; we're already talking about reductions next year - maybe. Of all of these types of funds, PRWCX and FBALX seem to always stand at the head of the class.

    You should get to know the history of FPACX
    From my post, it would be logical to assume that I am quite aware of its history. I’ve owned it and it is quite good… but… He always seems to be holding a lot of cash; regardless of the investing environment. That’s been fine recently, but there were times when I would rather have seen him buying something; especially when cash was paying nothing. Obviously, that has been beneficial recently. It’s one of the funds I routinely watch.
    In any event, M* has FBALX and PRWCX in the first quartile of performance every year other than 2022 (ten times). FPACX hit that milestone four times; two of those in the last two years when cash was better than most traditional fixed income vehicles. What do you see that you think I don’t?
    racqueteer in Fund Discussions
  • CrossingBridge and Cohanzick 3Q23 Commentary - No Fat Pitches
    @Derf, another way to calculate TR is to use adjusted-prices between the 2 times.
    So, for simplicity, assuming that from 11/1/10 (adj-price 6.93) to 10/13/23 (adj-price 9.61) is almost 13 years, the TR = (9.61/6.93)^(1/13) = 1.02547 or +2.55%. So-so over 13 years.
    Using SPY instead, adjusted-prices were 92.81 on 11/1/10 and 431.50 on 10/13/23, so TR = (431.50/92.81)^(1/13) = 1.1255 or 12.55%. Of course, this is to show the method, not to compare stock fund with HY bond fund.
    Backward-ratio-adjustment applies to ALL prices prior to the dividend date. That is why it works.
    yogibearbull yogibearbull in Fund Discussions
  • Leuthold: the lights have all turned red, time to lighten up on stocks
    Agree, BaluBalu. Those who know me know that I've spent a lot of time looking at the Allocation-type funds over the years, and while traditional bonds have done them no favors with rates rising; we're already talking about reductions next year - maybe. Of all of these types of funds, PRWCX and FBALX seem to always stand at the head of the class.
    You should get to know the history of FPACX
    davidrmoran davidrmoran in Fund Discussions
  • November MFO Ratings Posted
    Spent summer implementing two big changes to the offline number crunching routines (programs that take the Lipper month return data and derive our risk and return metrics):
    1) hooks for ratings by SubType (i.e., US Equity) and Type (i.e., Bonds), and
    2) imposing so-called "Strict On" and "Explicit On" coding options, which help ensure accuracy and shorten crunch time ... a lot. What used to take 20-24 hours now takes 6-8.
    Both updates rippled through ten years of code, so took a while.
    Lipper dropped 13 October data just before 6am Pacific. I'm hoping to have that update posted later today. It's running now.
    Charles Charles in MFO Premium
  • Towle Deep Value Fund: what a difference 10 days can make
    Towle is a deep value / small cap fund. It's about the purest deep value play around, which is attractive because the academic research says that the "value effect" is most apparently in really deep value just as the small cap effect is most visible in really small caps.
    Nice people doing hard stuff.
    They're currently a one-star fund in Morningstar's system. Charles's rating of them since inception (2011) is comparable: 1 (lowest 20% in the peer group based on risk adjusted returns). Which made their quarterly report pop, as they noted that their SMA composite for their strategy returned just over 19% annually for the past three years. Morningstar's three-year numbers, which by default at the last 36 months from today, are far lower. Curious, I checked.
    What a difference 10 days makes: the fund loses one-third of its trailing three-year returns when you shift from 9/30/23 as your end date to 10/13/2023. That's about 10 trading days. But the opposite effect is seen in the five year returns, which improve by 50%.
    Three year returns (per Morningstar)
    As of 9/30/23: 19.18%
    As of 10/13/23: 12.74% - a 33% decline
    Five year returns
    As of 9/30/23: 2.47%
    As of 10/13/23: 3.76% - a 50% rise
    Ten year returns
    As of 9/30/23: 6.43%
    As of 10/13/23: 5.86% - a 10% decline
    One reason that MFO traditionally pushed "full market cycles" as the metric rather than arbitrary windows (what is the significance of "three years"?) is that you need to find a way to avoid being misled by performance reports that might reflect one performance bubble rolling off just as a drawdown rolls on.
    Which is to say: look long and hard (looking at you, Ms. Woods) before concluding "those numbers are sweet! Here's my money!"
    David_Snowball in Fund Discussions
  • CrossingBridge and Cohanzick 3Q23 Commentary - No Fat Pitches
    OK, this is about 11/1/10. I see at Yahoo Finance,
    Nov 01, 2010 9.98 9.98 9.98 9.98 6.93
    But this didn't happen just on that day. It represents years of dividend/CG adjustment between 10/1/10 and now (about 13 years!). That is lot of backward-ratio-adjustments in adjusted-prices.
    yogibearbull yogibearbull in Fund Discussions
  • Leuthold: the lights have all turned red, time to lighten up on stocks
    I prefer PRWCX . It beat FBALX for 3-5-10-15 years and tie for one year and with lower SD.
    One of the only funds that looks everywhere. PRWCX has a big % of its bonds in HY+BL.
    FD1000 in Fund Discussions
  • SS COLA 2024
    @Old Joe . My guess is the CMS just pulls numbers out of some data banks which are not accurate.
    Enough with the guessing, please. Not when two minutes of searching can turn up the actual practices one is interested in.
    BLS data collectors visit (in person, on the web, or using apps) or call thousands of retail stores, service establishments, rental units, and doctors' offices, all over the United States to obtain information on the prices of the thousands of items used to track and measure price changes in the CPI. We record the prices of about 80,000 items each month, representing a scientifically selected sample of the prices paid by consumers for goods and services purchased.
    During each call or visit, the data collector collects price data on a specific good or service that was precisely defined during an earlier visit. If the selected item is no longer available, or if there have been changes in the quality or quantity (for example, a 64-ounce container has been replaced by a 59-ounce container) of the good or service since the last time prices were collected, a new item is selected or the quality change in the current item is recorded.
    Prices used to compute the CPI are collected during the entire month. CPI data is published monthly, with the index value representing an estimate of the price level for the month as a whole, rather than a specific date. Since certain prices, particularly gasoline, might move sharply within a month, it is useful to understand the timing of price collection. A month is divided into three pricing periods, each period corresponding to roughly the first ten days, second ten days, or third ten days of the month.
    When an item is initiated into the CPI sample, its pricing period is established, and it will be repriced during that same period until it exits the sample after four years. Data collectors have discretion within pricing periods, so they can collect quotes at any time during the period. So, it's not necessarily true that data collection is spread perfectly evenly through the month; however, roughly equal amounts of data are collected in each pricing period. Rent prices are an exception to this, as prices in the rent sample are not divided by pricing periods, and specific rent quotes can be collected at any time during the month.
    Pricing information is then sent to our national office, where specialists who have detailed knowledge about the particular goods or services review the data. These specialists check the data for accuracy and consistency, and make any necessary corrections or adjustments. Adjustments can range from an adjustment for a change in the size or quantity of a packaged item, to more complex adjustments based upon statistical analysis of the value of an item's features or quality. Thus, commodity specialists strive to prevent changes in the quality of items from affecting the CPI's measurement of price change.
    https://www.bls.gov/cpi/questions-and-answers.htm (Q11)
    Use a discount store such as Aldi or Walmart.
    You and @hank seem to be conflating dollar increases with percentage increases. An item might cost $10 at Aldi and $12 at Safeway, or $10 in Lansing and $12 in U.P. (say, in Houghton, whose cost of living is 17% higher than Lansing's).
    If prices everywhere go up 10%, then in the lower priced store (area) the price increases "just" $1, while in the higher priced store (area) the price increases $1.20. Some might look at that and think "20% more", but it's the same percentage increase.
    Certainly a $1 increase would represent a higher percentage price hike where prices are cheaper (Aldi, Lansing) than where prices are more expensive (Safeway, Houghton). But why would one expect the dollar increase to be the same in both places?
    I don't expect gas prices to go up by just 10¢ a gallon in Honolulu when they go up by a dime in Kalamazoo. There's more to the retail price of gas than the cost of the product itself. There are shipping costs, real estate (gas station) costs, etc. Those aren't fixed; they're going up also, and those costs are higher for Hawaii than elsewhere.
    There are differences by region and by retailer. A sampling is not representative if restricted to one store, type of store, or region.
    msf in Other Investing
  • SS COLA 2024
    No comment on whether I “believe” the numbers. I don’t dispute that they are honestly computed based on their best ability and the complex methods they use. Catch’s post explains the methodology. So I accept them.
    Where I wonder … Are they comparing apples to apples? If the quality / flavor of my cereal falls, if the fat content of a pound of sirloin increases, if the nutritional value of a pre-cooked frozen meal is lessened, if containers are more cheaply made and break easier, or if smaller sized packages are no longer available (forcing you to buy more than wanted) … do those changes get reflected in COLA? With beer I try to find 12 fl. oz bottles. But a lot of them are now 11.2 oz. Did the COLA gurus factor that in? And if I’m now doing my own scanning and bagging of groceries shouldn’t that devalue those products compared to their worth when checkout service once taken for granted?
    With autos - Do we as consumers realize that they’re in no way comparable to what we bought new just 10 years ago? I’d imagine those COLA figures take into account in price comparisons that a new car today is likely to have factory installed radar, back-up cameras, larger tires and rims, GPS and internet functionality. If they include these new features to a car’s “value” (as I suspect), than the cost increase year to year would appear a lot less on the chart, but would still still ding your pocketbook a whole lot more than 10 years ago. Hard to argue these features don’t increase value / desirability. Few of us would throw them overboard.
    Entertainment? How on earth can they get a firm grip on prices? My Disney /Hulu / ESPN pack is constantly being repriced (upward). While more commercials are being inserted into programs. Fewer top quality channels to choose from. So many different “for-purchase” “extras” (that were once included) that it would take a really sophisticated analyst to get to the bottom of it all.
    One thing that has offset the cost of living in recent years is that some electronic devices have fallen in price. A cheap cellphone can probably be bought for $35 on Amazon. TV’s have come down in price over the past couple decades. And cellular providers have been in a war to undercut one another so that your voice / data subscription may cost less today than 5-10 years ago.
    hank in Other Investing
  • SS COLA 2024
    FWIW I just do not believe the numbers CMS spews out as noted in the yellow graph above. Except for the egg cost decreases which I have seen ,almost every other food item in our discount grocery stores has risen sharply in the past year. Along with the other items used for the inflation % computation in the graph I think the numbers do not reflect the true past year, total averaged inflation rate. Do you believe every fact or number published by any of our government officials or entities? Example. Mayorkas the Homeland secretary has stated for years "Our border is secure and not open". Really!!! We agree to disagree. Over and out.
    fundly in Other Investing